Japan Stocks Jump to Highest Close in Month Following U.S. Surge

  • Global equities climb with S&P 500 following factory data
  • Toyota, Mitsubishi UFJ soar to lead gains on Topix index

Japanese stocks jumped to the highest closing level in a month, adding to a global rebound in equities, as the yen weakened and U.S. data indicated manufacturing in the world’s largest economy may be stabilizing.

The Topix index jumped 3.8 percent to 1,349.61 in Tokyo, with all of its 33 industry groups rising. The Nikkei 225 Stock Average added 4.1 percent to 16,746.55, with both measures closing at the highest level since Feb. 8. The yen traded at 113.92 per dollar after dropping 1.1 percent on Tuesday. The Nasdaq 100 Index powered to its best day in six months as U.S. equities lead a March revival in global equities amid signs that the world’s largest economy remains on firm footing. 

“The U.S. economy isn’t as bad as we had expected,” said Takahisa Odaka, a Tokyo-based equity market strategist at Nomura Holdings Inc. “It’ll take time to heal the wound in Japanese shares, but the bottom is getting firmer. If U.S. economic data gets stronger and investors become more confident the global economy isn’t slowing, we could see some buying back of shares.”

Toyota Motor Corp., the world’s No. 1 carmaker, gained 3.5 percent to be the single largest boost to the Topix. Its Lexus car edged into the monthly lead in U.S. luxury-vehicle sales, outselling BMW AG and Daimler AG’s Mercedes-Benz. Mitsubishi UFJ Financial Group Inc., Japan’s biggest lender, rose 5.8 percent. Sharp Corp. added 2.3 percent amid continuing talks with Foxconn Technology Group for a rescue deal. Alps Electric Co. surged 13 percent.

Futures on the Standard & Poor’s 500 Index added 0.2 percent. The underlying equity measure soared 2.4 percent on Tuesday, the most in a month, after data showed American factories look set to emerge from a yearlong slump, while monthly gains at major carmakers showed consumers stepping up spending a day after China added to stimulus, alleviating anxieties that had sent U.S. shares to the worst start to a year on record.

China Stimulus

China said Monday it would reduce the amount of cash lenders must lock away in a bid to cushion a slowdown there. Manufacturing data trailed estimates Tuesday, reinforcing concern about the health of Asia’s largest economy.

While February marked a fourth consecutive monthly slide for global stocks, signs that financial tension in China and a slump in commodities are abating has seen shares recover more than 7 percent from a 2 1/2-year low on Feb. 11. Data suggesting that American consumers can still power the world’s largest economy and hints from central banks in Asia and Europe that more stimulus is at the ready underpinned the revival.

U.S. presidential primaries moved into focus today, with more delegates to be awarded than on any other day of the nomination race. Donald Trump exploited a divided Republican Party to take at least seven states as part of a commanding Super Tuesday showing, even as Senator Ted Cruz of Texas managed to win his home state and neighboring Oklahoma.

Investors are also assessing economic releases to gauge the possible trajectory of interest-rate increases before the Federal Reserve’s next decision on March 16, with the government’s monthly jobs report looming on Friday.

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